AMC may be fortunate enough to broadcast several of today’s hit series like Mad Men and The Walking Dead (let’s also not forget the phenomenal Breaking Bad, which ended its run last year) but just because the network has seen much success with original programing in recent years doesn’t mean they don’t have their fair share of issues.
In fact, in addition to AMC’s highly publicized clashes with various showrunners (TWD alone has had three showrunners since its first season) the network is also known for having trouble controlling its how much it spends annually on original shows, which may be starting to worry investors. Last Thursday, May 8, the network’s stock hit a 52-week low of $53.99 per share.
Yes, the network had an impressive first quarter during which earnings rose over the first quarter of last year (largely due to the TWD Season 4 finale) but The Hollywood Reporter notes that analysts were actually expecting the network to have even larger gains than what it ended up with.
Several analysts have surmised that the network’s less than impressive gains stem from the fact that they are still spending too much on original shows, like TWD.
Evercore Partners analyst Alan Gould wrote in a first review, via THR,: "AMC reported strong revenue, but had much higher marketing and programming expense than expected." He added: "We expect this will be a consistent theme as the environment for finding new hit shows is more competitive than ever, with Showtime, Starz, Fox and Turner all targeting edgier serialized dramas, as well as incumbent HBO and Netflix and Amazon. We believe it will be very challenging, and expensive, for AMC to repeat the trifecta it had with Walking Dead, Breaking Bad and Mad Men.”
Since AMC produces their own shows in-house they automatically incur more expenses than many other networks. Still the budget for Season 1 of TWD was reportedly $3.4 million, and even after budget cuts Season 2 reportedly had a budget of $2.75 million.
However, unlike Mr. Gould, we don’t doubt AMC’s ability to repeat the Walking Dead, Breaking Bad, and Mad Men trifecta. If they did it once, they can do it again, right?
Are you worried about AMC’s spending, or are you happy as long as they keep cranking out great television? Vote below!
The Walking Dead Season 5 premieres in October 2014 on AMC.
Source: The Hollywood Reporter